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I believe the story is that the “no” was because they had neglected to actually ask her about it, and the “yes” is what she said when he posted it on YouTube. (Evidently, his code of ethics and/or contract only requires him to get permission before releasing parodies in albums, not before posting them on the ‘net.)

I believe the problem is copywrite violation. Since the music is directly copied, he can be taken to court, be forced to pay a fine, and turn over all profits from sales. A free Internet release circumvents the law, and the worst they can do is ask it to be taken down.

There are laws governing what constitutes a parody, which I’m certain that Weird Al is well aware of, otherwise he would have been sued into oblivion before his career even started. He’s not required to get permission to do a parody, but he prefers to ask.

Coolio publicly threatened Wierd Al after saying no to the request “to be cool”, and there was no discernible consequence for his action, so quite frankly I think he got off easy. It’s not Weird Al’s fault that “Amish Paradise” is the better song.